What was the total lease liability for Crawlspace Medic in 2023?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
f the individual lease terms.
Amounts reported on the balance sheet as of December 31, 2023 and 2022 were as follows:
| Operating Leases: | 2023 | 2022 | |
|---|---|---|---|
| ROU asset | $ 35,224 | $ 35,224 | |
| ROU amortization | (14,090) | (7,045) | |
| Total ROU Asset, Net | $ 21,135 | 28,179 | |
| Lease liability: | |||
| Current portion of lease liability | $ 7,054 | 6, |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 42)
What This Means (2024 FDD)
According to Crawlspace Medic's 2024 Franchise Disclosure Document, the total lease liability for 2023 was $19,968. This figure represents the sum of the current portion of the lease liability, which was $7,054, and the non-current portion of the lease liability, which was $12,914.
For a prospective Crawlspace Medic franchisee, understanding the lease liability is crucial as it reflects the company's financial obligations related to its leased assets. This liability is broken down into current (due within one year) and non-current (due beyond one year) portions, providing a clearer picture of the company's short-term and long-term financial commitments.
It's also worth noting that Crawlspace Medic adopted FASB ASC 842, Leases, which resulted in the recognition of a right-of-use (ROU) asset and related liability. This accounting standard requires companies to recognize lease assets and liabilities on the balance sheet, offering greater transparency into their leasing activities. The ROU asset for 2023 was valued at $35,224, with amortization of $14,090, resulting in a net ROU asset of $21,135.